Michael Broida, CPA of Heller, Broida & Eisenberg Accountancy Corp. (www.HBEAC.com), discusses ways to come up with more funding for your small business.
- Use any personal savings
- Look to family for investment
- Close friends can be a good source for potentia
Finding the money to start the business is very difficult. The first place you have to look is yourself, you have savings or you should have savings. This can be a lot, it can be a little, again, depends upon the type of business that you’re starting.
Second place is family. Why family? Beause they believe in you, they trust you and they’re going to think that you’re going to be successful. You can talk to your friends, some of them may want to invest, they may have savings on their own but they don’t have the ambition to start a business, they want to work for somebody else.
Last place, the bank, and the bank includes your credit cards, you have to be very careful about using credit card debt to finance your business. The bank requires many things including your tax returns, including a business plan, and they want to see a budget but, the bank is there to help you start your business because they look down the road and see you as a potential customer.
Expect disappointment, not everybody is going to want to give you money to help you start your business. Also, each of these don’t need to work independently, they can work in conjunction with one another, your savings may be combined with your family money. Your friends may be combined with your family because you don’t have any savings. The bank may look at you and say, “We need more information, we’re interested.” They want to help you help you because they want a future customer.